NYSE$ECL

Ecolab Inc · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

Ecolab's Q4 2020 earnings improved from the third quarter despite the negative impact of a greater than expected COVID-19 second wave.

Ecolab's fourth quarter earnings showed sequential improvement from the third quarter despite the negative impact from the greater than expected COVID-19 second wave. Reported sales from continuing operations decreased by 6% from the year-ago period. Adjusted diluted EPS from continuing operations were $1.23, a decrease of 15% versus last year.

  • Fourth quarter earnings showed sequential improvement from the third quarter despite the negative impact from the greater than expected COVID-19 second wave.
  • Reported sales from continuing operations decreased 6% from the year-ago period.
  • Reported diluted EPS from continuing operations was $1.04, a decrease of 23% versus last year.
  • Adjusted diluted EPS from continuing operations were $1.23, a decrease of 15% versus last year, reflecting COVID-19 related volume declines, unfavorable business mix and investments in the business which together more than offset cost savings, favorable pricing and lower variable compensation.

Headline financials

Total Revenue

$3.07B

Previous: $3.82B-19.8%
EPS (adj)

$1.23

Previous: $1.69-27.2%
Reported GAAP operating income margin

13.6%

Previous: 14.7%-7.5%
Capital Expenditures

$127M

Previous: $250M-49.4%
Free Cash Flow

$523M

Previous: $571M-8.4%
Net Income

$300M

Previous: $430M-30.1%
Operating Income

$416M

Previous: $560M-25.7%
Gross Profit

$1.29B

Previous: $1.61B-20.0%
Cash & Equivalents

$1.26B

Previous: $119M+960.8%
Total Assets

$18.1B

Previous: $20.9B-13.1%
Stock-Based Comp

$17M

Previous: $17.9M-5.0%

Revenue & EPS history

Ecolab · Revenue · Quarterly

$3.07B

Q4 2020-19.8%vs Q4 2019
Beat estimate in 10 of 16 quarters(63%)
ActualEstimate

Revenue by segment

Ecolab · $1.17B total across 2 segments · Q4 2020

  • Global Institutional & Specialty
    $882M-33.3%
  • Global Pest Elimination
    $283M+26.1%

Forward guidance

Ecolab expects COVID-19 will continue to have a significant effect on the economy and its end markets, with its primary impact in the early part of the year. The company expects to see the beginning of the COVID-19 recovery in its global end markets starting in the second quarter but believes it will take several quarters to fully realize a new normal.

Tailwinds

  • Strong new business wins
  • Product and service innovation
  • Investments in new hygiene and digital technologies
  • Successful sales
  • Profit initiatives

Headwinds

  • COVID-19 will continue to have a significant effect on the economy and our end markets
  • Primary impact in the early part of the year
  • Beginning of the COVID-19 recovery in our global end markets starting in the second quarter
  • It will take until the end of the year to generally reach a new normal
  • Continued uncertain outlook regarding the timing and pace of global economic recovery from COVID-19’s impact does not yet present an adequate basis for us to provide either quarterly or annual earnings forecasts.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2020

Historical avgQ4 2020

+0.1%

Avg return

Earnings day

-0.0%

Avg return

5 days after

+1.3%

Avg return

30 days after

58%

42 / 73 earnings

Positive

+10.9%

Q4 2022

Best reaction

-12.6%

Q3 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.8%-3.1%-3.1%
Q4 2025+4.0%+3.8%-4.3%
Q3 2025-4.1%-8.3%-1.7%
Q2 2025+0.4%+2.9%+1.8%
Q1 2025+3.3%+6.8%+10.6%
Q4 2024+6.2%+7.6%+2.1%
Q3 2024-1.5%-4.6%-3.4%
Q2 2024-6.9%-4.3%+0.9%
Q1 2024+1.5%+2.6%+3.2%
Q4 2023+6.9%+1.7%-1.4%
Q3 2023+5.1%+9.8%+20.5%
Q2 2023+1.0%-0.3%+0.4%
Q1 2023+2.7%+2.9%+0.2%
Q4 2022+10.9%+9.8%+7.4%
Q3 2022-12.6%-14.2%-3.3%
Q2 2022-1.3%+1.5%+5.0%
Q1 2022-2.9%-3.6%-6.5%
Q4 2021-0.1%-2.3%-6.1%
Q3 2021-0.2%+0.3%+4.4%
Q2 2021-0.0%+0.8%+1.8%
Q1 2021-2.1%-1.2%-4.7%
Q4 2020-5.0%-5.4%-4.7%
Q3 2020-6.5%-7.4%+10.0%
Q2 2020-8.1%-11.8%-6.8%
Q1 2020+5.4%+1.3%+12.7%
Q4 2019+1.4%+0.1%-23.0%
Q3 2019+1.1%-0.3%-2.4%
Q2 2019+0.6%-0.3%+3.2%
Q1 2019-1.1%+0.3%-0.6%
Q4 2018+1.1%+2.2%+7.5%
Q3 2018+4.5%+5.5%+8.1%
Q2 2018+2.8%+4.5%+6.7%
Q1 2018-0.4%+0.4%-1.5%
Q4 2017-1.2%-0.5%+2.0%
Q3 2017+0.3%+0.4%+3.8%
Q2 2017+0.9%+0.9%+1.2%
Q1 2017-2.8%-2.2%+3.5%
Q4 2016-0.7%+1.3%+0.2%
Q3 2016-1.9%-3.1%+3.8%
Q2 2016+2.3%+3.4%+3.7%
Q1 2016+0.9%
Q4 2015-5.5%
Q3 2015-0.3%
Q2 2015+6.4%
Q1 2015-1.4%
Q4 2014+3.8%
Q3 2014-2.2%
Q2 2014-1.5%
Q1 2014-0.9%
Q4 2013+0.5%
Q3 2013+3.0%
Q2 2013+0.0%
Q1 2013+1.2%
Q4 2012+6.2%
Q3 2012+0.1%
Q2 2012-3.6%
Q1 2012+1.0%
Q4 2011-4.2%
Q3 2011-4.6%
Q2 2011-3.5%
Q1 2011+2.5%
Q4 2010+2.4%
Q3 2010+0.3%
Q2 2010-0.7%
Q1 2009-1.7%
Q1 2010+1.2%
Q4 2007+0.5%
Q4 2009+0.5%
Q3 2009+2.2%
Q3 2008+2.2%
Q2 2009+0.0%
Q2 2008+0.0%
Q4 2008+0.0%

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